RAPIDUR INDIA PRIVATE LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) This writ petition is by a company registered as a small-scale industry with the Government of Goa, Daman and Diu, against the order of assessment dated 28th December, 1983 passed by the 2nd respondent under the Central Sales Tax Act, 1956 (hereinafter referred to as "the Central Sales Tax Act"). The assessment order pertains to the year ending December, 1978. The petition raises a question of interpretation of section 8(2A) of the Central Sales Tax Act as amended in 1972 which came into force on 1st April, 1973.

(2.) Few relevant facts before considering the rival contentions may be stated first. The petitioners are a small-scale industry registered with the Directorate of Industries, Government of Goa, Demand and Diu and hold a certificate of registration No. 56/03/01980. According to the petitioners they are manufacturers of plaster of paris bandages. Section 10(1) of the Goa Sales Tax Act provides that "no tax shall be payable under this Act on the sale of goods specified in the Second Schedule, subject to the conditions and exception, if any, set out therein". Second Schedule to the said Act contains several entries specifying exemption from sales tax. In exercise of powers contained in section 10(2) of the said Goa Sales Tax Act by a notification dated 4th February, 1971 the Government of Goa incorporated entry 68 in the said Second Schedule. The said entry 68 was thereafter amended by another notification dated 2nd November, 1982. It inter alia exempted totally from local sales tax the sales of all goods manufactured by a small-scale industry registered with the Government under the Goa, Daman and Diu Sales Tax Act, 1964 as amended from time to time, for a period of five years from the date of first sale on or after the validity of the registration.

(3.) The petitioners who are the registered small-scale industry, having their sales totally exempt from local sales tax, claimed also exemption from Central sales tax, in respect of their such part of turnover as related to inter-State sales of their said goods, under section 8(2A) of the Central Sales Tax Act. Accordingly the petitioners by their letter dated 10th December, 1983 to the Sales Tax Officer claimed such exemption. However, the Sales Tax Officer by his order of assessment dated 28th December, 1983 rejected the petitioners' claim and held that the petitioners were liable for payment of Central sales tax in respect of such turnover as related to inter-State sales and assessed them for the sales tax liability under Central sales tax for Rs. 69,735.10. After giving credit of Rs. 53,722.75 already paid he demanded from the petitioners a sum of Rs. 16,012.35. It is against this order that the petitioners have directly filed this writ petition.